Bitcoin and Ethereum: How They Work

Bitcoin and Ethereum are the two most popular cryptocurrencies in the world. But what are they, and how do they work?

Bitcoin is a digital currency that was created in 2009. It is decentralized, meaning that it is not controlled by any government or financial institution. Transactions are made using a digital asset called bitcoin, which is stored in a digital wallet. Bitcoin can be used to purchase goods and services online, or it can be traded for other cryptocurrencies or fiat currencies.

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third-party interference. Ethereum was created in 2015, and it is the second-largest cryptocurrency after Bitcoin. Ethereum can be used to pay for goods and services, or it can be traded for other cryptocurrencies or fiat currencies.

Both Bitcoin and Ethereum are based on blockchain technology. Blockchain is a distributed ledger that allows for secure, transparent, and tamper-proof transactions. The blockchain is maintained by a network of computers that process transactions and keep track of the blockchain.